Good morning, ladies and gentlemen. Welcome to Orange's First Quarter 2023 Results Conference Call. The call will be hosted by Ms. Christel Heydemann, CEO, and Mr. Jean-Michel Thibaud, Interim Executive Vice President, Finance, Performance and Development, with other members of Orange's Executive Committee for the Q&A session that will start after the presentation. Today's conference is being recorded. Thank you. Let me hand over to Ms. Christel Heydemann. Thank you. Good morning, everyone, and welcome to our Q1 2023 results presentation that I will command this morning together with Jean-Michel Thibaud, our interim CFO. Let's start with slide four, which presents the key highlights of the quarter. First of all, I would like to highlight that our value strategy is well on track, with 2022 price increases bearing fruit and new price moves in Q1, which will fuel retail growth in the coming quarters. Regarding Spain, convergent ARPU growth continued to drive retail services, which are back to growth this quarter at +1.2%, contributing to Europe's solid growth momentum at +3.8%. Let me also stress that execution is in action. Orange Business transformation is ongoing with, among others, a new organization and discussions started with unions on a voluntary departure plan. The VOO transaction was approved by the European Commission in March, enabling us to expect a closing at end of Q2 2023. In the Middle East and Africa, Orange Money is back in double digit growth territory, demonstrating our agility and efficiency in responding to a tougher competitive environment. Q1, the Q1 results are consistent with our full year guidance, with EBITDA up 0.5% and ECAPEX down almost -5%. Let's have a closer look at our main financial KPIs on slide five. In the first quarter, the group delivered revenues of EUR 10.6 billion, up by +1.3% year-on-year, driven by growth in retail services +2.8% and equipment sales +9.5%. That much more than offset the decline in wholesale -7.7%. From a segment perspective, revenue growth was driven by a Middle East and Africa performance of +9.1% and by Europe +3.8%, with the return to growth in Spain confirmed +2.8%. TOTEM also grew by 8.1%, with a 7% increase in external hosting revenues. In France, revenues were down by -1.8% due to the decline in wholesale, which was in line with our expectations, partially offset by retail revenues at a foreseen low point for the year. Orange Business revenues' slight decrease, -0.7%, was still due to the strong decline in fixed voice, -11.6%, partially offset by the growth of our digital activities. Group EBITDA at EUR 2.6 billion was up by 0.5%, giving us full confidence in reaching our full year 2023 guidance. As usual, our EBITDA margin is lower in the first quarter due to the seasonality of operating taxes. This phasing was accentuated this year by the timing of our latest price increases, whose positive effect will be fully seen later in the year. ECAPEX was reduced by -4.9% in line with our full year guidance. I will now hand over to Jean-Michel for the detailed results review. Thank you, Christel. Good morning, everyone. Let's start our segments review with France on slide 7. The overall decrease in Q1 revenues is linked to the decline in wholesale in line with the expected medium term trend. This decline was partially offset by retail growth, which will accelerate over the rest of the year. Market pricing has continued its positive year-on-year trend following our lead of base repricing of both the front book and back book as announced since last December, and which will be fully effective from Q2. All customers impacted by the price increases have now been notified. The limited churn impact weighing on our net adds this quarter is fully in line with our forecasts, thanks to our network quality as confirmed by Arcep and our very strong NPS. The positive impact of this value strategy will be reflected in our financials later this year. These price hikes will indeed further drive up the convergent ARPU, which increased in Q1 by +2%, passing EUR 72 and showing the +2.1% growth in retail services excluding PSTN. This value strategy, which will bear fruit mostly in H2 on Orange France EBITDA, along with our continued cost efforts, will mitigate but not offset inflation pressure that will peak this year. France will contribute from 2023 to the group's organic cash flow growth thanks to strong ECAPEX discipline. Let's now turn to Europe on slide eight. Europe consolidated the good momentum of recent quarters with an acceleration in overall growth and particularly in retail revenues. This solid performance was driven by convergence and mobile thanks to the price increases implemented all across geographies. Equipment sales also grew strongly in the quarter, while the decline in wholesale was due to the regulatory cuts in termination rates with no effect on EBITDA. Looking per country, this performance was mainly driven by Poland at +7% and Spain that we are now going to dig into on page nine. In Spain, for the third consecutive quarter, we confirmed top-line growth thanks to retail services back to growth and strong equipment sales. In a still highly competitive market, we continue to support value through a better mix associated with a disciplined promotional policy and B2B growth. These measures were reflected this quarter in the continued growth of convergent ARPU at +3.5%, while churn levels keep on improving. This growth momentum, in addition to our cost control management, makes us confident in our ability to return to EBITDA growth this year. Regarding the joint venture with MásMóvil, the antitrust process is ongoing with the European Commission, which opened on April third, as expected, its in-depth investigation into the transaction. We expect a closing during the second half of the year. Let me now turn to Africa and the Middle East on slide 10, which again delivered a remarkable performance this quarter with a revenue growth of over 9%. This is proof of our agility and resilience despite being confronted to geopolitical tensions and currency devaluation in certain markets. All our countries grew this quarter with nearly half recalling double-digit growth. This performance continues to be based on very solid retail services, growing by +9.4%, ensured by the double-digit growth of our four growth drivers data, fixed broadband, Orange Money and B2B. Our mobile customer base reached 143.9 million, representing a +5% increase, delivering an average mobile ARPU increase of 3%. Let me highlight in particular the strong +21% growth of Orange Money revenues. This demonstrates the effectiveness of our response to new competition, which has put us back to a double-digit trajectory. Turning to Orange Business on slide 11, we are seeing the continuation of the business trend of previous quarters, with total revenues close to flat in the quarter. This is a result of the growth in IT and IS, which, depending on the quarter, more or less offsets the continued decline in the legacy business, in particular voice. I would particularly like to highlight this quarter the strong double-digit performance of digital and data and Orange Cyberdefense, which you see on the slide. As explained during our Capital Markets Day in February, Orange Business deep reorganization is ongoing, and we plan to drastically reduce costs, which led us to open negotiations with trade unions on a collective redundancy agreement for approximately 670 positions on an exclusively voluntary basis in the main historical activities in Orange Business in France. At the same time, we have initiated the upskilling and reskilling of 5,000 employees from traditional telecom areas to the world of virtualization, cloud, data, AI, and cyber. We also plan to accelerate the development of our digital business by launching an ambitious recruitment program to hire 800 additional cybersecurity experts and about the same number of people in digital services. The action plan is therefore ongoing, as announced in February, and EBITDA recovery will take time with a turnaround in 2025. I will now hand over to Christel, who will conclude today's presentation. Thank you, Jean-Michel. I would like to conclude this presentation simply by reaffirming that this first quarter's results underpin our confidence in achieving our full year guidance, which remains unchanged. Thank you for your attention. Jean-Michel, the Comex, and I are now ready for your questions. Thank you. Ladies and gentlemen, in order to give time to everyone, please limit yourselves to only one or two questions. To ask for the floor, please press the star or asterisk key followed by the digit one on your telephone keypad. Please ensure that the mute function on your telephone is switched off to allow your signal to reach our equipment. If we don't have time to take your question, then please contact our investor relations team after the call. If you find that your question has been answered, you may remove yourself from the queue by pressing star two. Again, please press star one to ask a question today. Our first question today comes from Nicolas Cote-Colisson from HSBC. Please go ahead. Hi, good morning. Two short questions, please. The first one is on the commercial performance in France. If you could give us more color about whether the weakness in net adds was either driven by the lower growth adds or higher churn. I guess I wonder at which level the price rise announcements are impacting, is it on recruitment or on the existing base, and whether we should consider further customer attrition in Q2 and forward. My second question is on fiber in France and the requirement by the regulator to complete the coverage in the medium dense area. Is it fair to say that we're talking about 1 million lines? If you could help us with the timing to deliver these lines and the possibly incremental CapEx budget that this could represent, possibly in 2023, that would be great. Thank you. Thank you for your question. I will hand over the question to Jean-François Fallacher, who as you know to cover the responsibility for France as of April. Just to tell you that the commercial performance in France in Q1 is fully aligned with our plans. There is no surprise. I let Jean-François comment in more, with more colors. Thank you very much, Chris. Thanks for the question. Well, you state that the commercial performance is lower than you initially expected, which is not, as Christel was saying, our assessment here. As you've seen, we have positive net adds all across the line in mobile and in fixed broadband. When you look at the level of net adds in fiber, I find it pretty impressive looking at the overall context. I mean, Fabian and the team, which are here have been obviously doing a great job this quarter to increase prices very significantly, as you know. You will remember, all of you, that we have increased prices of EUR 2 on broadband and EUR 1 in mobile, meaning that if you are having the convergent offer, this is obviously a mix of all of this. Price raises could go up to even 5 EUR, something like that, when you have a convergent package. You can imagine that obviously this move, which is going to be absolutely key for our performance in the second quarter and in the second semester of the year, was not completely for free. I mean, when you do such price moves on a market as competitive as France, there are some impacts. To be very precise and answer your questions, I mean, if you compare Quarter -on- Quarter, the churn is very much on track, and we are pretty happy with this and confident for the future. It's more on the gross adds that indeed things have been a bit weaker than usual. Once more, we have decided for a question of fairness between our base and our new adds to keep the same level of price and to lower the promotion. That explains clearly this. As Christel was saying, absolutely on track with the plans we were having. Regarding your second question on the fiber deployment in France. First of all, I mean, we keep on deploying fiber as per our plan in France. We don't foresee any change to our guideline for CapEx. The debate that was with the regulator in France on our fiber rollout was based, or at least the legal debate, the dispute was based on a milestone for 2020, which we have now fully achieved. There is no impact in our CapEx plan moving forward. Okay, thank you. Thank you. We're moving on to our next question now, which comes from Roshan Ranjit of Deutsche Bank. Please go ahead. Good morning, everyone. Thank you for the questions. My first question is in France, please, actually, on the cost side. Now, when you gave your group guidance at the CMD in February, sort of slight EBITDA growth, that was pre the wage negotiations, which completed last month. I think you said as part of those discussions, you had reached a collective decision with the unions, which I think is different from what has happened in previous years. I guess my question is, given that, do you see a kind of better outcome on your EBITDA trajectory, given the 4.8% increase that you managed to achieve? Secondly, on enterprise, last year you completed that carve out of the business. Could you give us some signs of the immediate results of that? Any kind of smaller bolt-on acquisitions that you have down the road as you look to turn that unit around over the coming years? Thank you. Thank you. On the wage impact on our guidance and on the first performance, we are very happy to confirm that indeed we reached an agreement with all our unions on the wage increase at 4.8%, which is an average. Actually for lower level salaries, this will be more, but that has no impact on our EBITDA trajectory. I would say that what has more impact on the cost structure is the departure plan, early retirement plan that we had signed end of 2021, which was very active as we discussed after the Capital Markets Day. But overall, no impact. We are indeed happy that we reached this agreement with the unions. On the Orange Cyberdefense performance, as we said, we are very active. The commercial performance in Q1 confirms the strong dynamic in the market and our performance in this market. The carve out was key for us to get agility. At the same time, as you know, we are transforming Orange Business. We've been active with a small acquisition in Switzerland in Q4. We keep being active monitoring the market. Nothing to report as we discuss. Okay. Thank you. Thank you. We're now moving on to a question from Mathieu Robilliard of Barclays. Please go ahead. Yes, good morning, and thank you for the presentation. I think in the past you had said that for 2023 as a whole, it could represent EUR 300 million headwind to the group EBITDA. My understanding is that probably two-third of that would affect France, and I wanted to understand a little bit more the phasing. I suspect it's probably more weighted towards the first half and possibly the first quarter, so maybe if you could give us a sense of how this rolls out throughout the year. The second question on pricing. I hear your positive comments, indeed, you've increased quite a number of prices. I do note, however, that there's a bit of a return of promotional activity at the lower end on some of the second brands, and I don't know if that was triggered by you or by someone else. Maybe if you could give a bit of color on the very short-term moves. Thank you. Thank you. I will let Jean-Michel confirm the, on energy and Jean-François will answer for the commercial, I would say, traction in France. We can also discuss about other countries in Europe, but I think your question was more related to France. Yes, good morning. Mathieu. Yes, indeed. The numbers you have in mind are correct. About EUR 300 million increase in 2023 compared to 2022 with about two-third in France. That's more or less evenly shared or spread across the year. I would add that we have taken benefit of the prices that have gone a bit down, particularly in the beginning of the year, to continue our hedging policy, and especially, well, 2023 was already fully hedged. We have completed our hedging policy for 2024, where we have more than, well, 75% of the spend which is now covered. On the promotion side, on the second brands, I mean, obviously, I am looking in detail into this, and I looked in detail about the recent history. The first good news that you have probably seen it, as you follow very closely the French market, is that first of all, the level of promotion, this quarter, this first quarter, if we compare it to the first quarter of 2022, is really, going, to our opinion, in the right direction because all the players, including those, who are actually claiming they are not changing their prices, have, actually lowered their level of promotion or raised the prices in the promotion. I think this is very good news for the French market. That's the first thing I would like to state. The second thing that we have to state on Sosh, more precisely, yes, there's been a lot of movement in the first quarter about the different players' promotion. If you look precisely at the key price point of Sosh, we are at this moment at EUR 15.99 ourself, and the two other competitors are actually EUR 2 lower. We are clearly here as well, playing the role of leader we have on the French market, being extremely cautious on the promotions, and extremely, I would say, disciplined on the level of promotion we are putting on the French market on the second brand. I mean, so far, so good. Again, as I was saying, when we look at our commercial performance, this is exactly as planned. Great. Thank you very much. Thank you. Up next, we have Sam McHugh from BNP Paribas Exane. Please go ahead. Yeah. Good morning, guys. Christel, I guess you've been in the job for a year now. You know, the organic improvement generally has been pretty good across the group. I just wanted to ask about inorganic actions. I mean, there are two things I would think about, Orange Bank and TOTEM. You know, we see a lot of headlines around Orange Bank. Can you just give us a bit of an update on where you're thinking on both those assets? Do you think it's reasonable to think we could see some kind of inorganic deal across the bank or TOTEM in the next 12 months? Thanks very much. Thank you. I think as we've said for Orange Bank, we are indeed in the process of our strategic review, and we have actively looking for partners. We have received interest. We are discussing, but at this stage, no decision has been made, and it's premature to make any further comments. On TOTEM, similar. I mean, as we said, we are focused on the organic growth for TOTEM, and we keep on increasing the tenancy ratio on our sites. At the same time, we are part of the European landscape for TowerCo. We would be considering options if they really make sense and bring, create value, as we said, improving our, our road share along the base. Again, no further comment to make and no active, I would say, discussion. All right, thank you very much. Thank you. We're moving to Andrew Lee of Goldman Sachs. Please go ahead. Yeah. Good morning. I have two questions. Just first question was just on your wholesale revenue drag in France in the quarter. Obviously, there's a lumpiness to that. I wonder if you could give us a bit more of an insight into how you see the rest of the year progressing in terms of that lumpiness. The structural question on that is really... Is there any reason to believe at this point that your guidance for wholesale revenue and EBITDA losses out to 2025 still holds? Or that actually you're seeing greater take up of co-financing than you might have expected? That, those are my two key questions. If I could have a follow-up, I just wondered if there's any deviation in your ability to raise prices at the consumer broadband level dependent on region, i.e., where you have greater network overlap, for example, in the densely populated areas. Thank you. I think the wholesale performance in Q1 is fully aligned with our forecast. There's no further or no I would say improvement or decrease, which is expected around 7% year-on-year for the year. It's fully in line. We know, you know, as you know, I mean, there's the copper and fiber wholesale, but there's also a interconnection and low margin evolution in wholesale that's also dragging the revenues down. Today it's exactly as per plan. As you know, in France in particular, we have a lot of discussion with the regulator on the unbundling price for copper, on the next phase of regulation as well for fiber and for the copper decommissioning. There will be active discussion, but it's moving as planned. We see no change, absolutely no change to our guidance on that front. Thank you. Thank you. We're moving on to our next question from Stéphane Beyazian of ODDO BHF. Please go ahead. Yes, thank you. I've got two follow-up if that's possible. Actually, one follow-up on the bank. Should you have issues to find a partner, are you still confident any way that you can lower the losses from Orange Bank from the banking operation in Europe in 2023? Can you tell us a little more about actions that can help to reduce the level of losses there? Perhaps one question, you know, you've made a lot of changes in the management team. Perhaps one yesterday regarding R&D. Do you have any specific expectation from your R&D at Orange? Any area of work where you think that the company should do better and bring, you know, new product, for instance? Thank you. Thank you, Stéphane. On the, on the bank, as you know, we are very, I mean, on the, on the bank as on everything, we're very focused obviously on the, on delivering our guidance. The Orange Bank team are absolutely delivering as per plan. The commercial performance is great and we have a very solid, balance sheet. So, so we are obviously and unfortunately, because we're acquiring customers and structurally indeed we are, we are making losses, but, I wouldn't say that, we will improve, drastically the losses in 2023. We are very much focused on executing our plan. The question is more, how do we accelerate the break even, which is currently foreseen, in 2025, 2026. That's the reason why we are looking for more strategic options with partners. On 2023, I don't think it would have, we will change the plan as that we currently have in the guidance. On the R&D and the innovation, indeed, we announced yesterday the appointment of Bruno Zerbib as the CTIO for the group who, and he will start on June 1st. He will succeed Michaël Trabbia, who has been managing this organization for several years. He will bring a fresh perspective on things, but also rely on the large expertise that we have inside. The focuses go as, I mean, as much from virtualization in our networks and improving or accelerating our plan, as well as driving the collaboration with our peers also in Europe. As you know, we have a number of very important initiatives. The Open Gateway initiative, which was announced in Barcelona, is an important initiative. So it's really delivering our plan, continuing to accelerate on using technology to accelerate our performance and improve the services we bring to customers, as well as accelerating on a number of innovations. No doubt that we will come back to you later in the year with more specific examples. Bruno has been both inside the telecom industry for a long time as well as outside. He will bring a broad perspective on many initiatives. Very good. Thank you. Thank you. Up next, we have Emmet Kelly from Morgan Stanley. Please go ahead. Yes. Good morning, everybody, thank you very much for the presentation, this morning. I've got two questions, please. The first question is just a follow-up on Andrew's question on the wholesale business. It looks like the trajectory is EUR 200 million less wholesale revenues in Q1. If I put that into a full year context, would it be fair to say that the trajectory of wholesale EBITDA declines might be a little bit more front-end loaded in 2023 and 2024 compared to 2025, given the top line that we see in Q1? I think you said you expect EBITDA to be down by EUR 400 million over the three years by 2025. Should we expect the phasing to be a little bit more front-end loaded there? The second question is just coming back to Barcelona, Christel, and the speech that you gave at the Mobile World Congress. I know the European Commission has asked for submissions on the fair share debate with tech companies. Do you have any updates that you can share with us this morning, please? Thank you very much. Thank you. I will answer first with your second question and then will hand over to Jean-Michel to comment on the wholesale trajectory. As you know, the European Union, the Commission has launched a consultation which is broadly open to many players on the future of digital infrastructure. The debate is not the fair share. It's much broader than that. As everyone, we will respond and provide our inputs to this consultation by mid-May, and we will be happy to comment in more detail. It's really too early to say what will come out of this consultation. At least there's now an open debate on how and who should invest and innovate for the future of our digital infrastructures in Europe, which is an important debate. No more comment at this stage. Michel, on? Yes. Emmet, on wholesale. Again, we have the EUR 1 billion impact on revenues and the EUR 400 million in EBITDA that we communicated two months ago, so we are perfectly in line with that. Indeed, that means that, well, that means two things. First, we have a bit of front loading compared to 2025. That's true. Also, we have some lower margin, if not, close to zero margin activity that are a bit softer in Q1. These are the two elements that explain this number, which does not surprise us at all. Super. Thank you very much. Thank you. As a brief reminder, to ask a question today, please signal by pressing star one. We now take a question from Georgios Ierodiaconou from Citi. Please go ahead. Yes, good morning, and thank you for taking my questions. The first one is regarding Spain and the improvement we've seen this quarter. Just looking through the numbers, and I know there's been an improvement in the upward trends on convergence, but based on your disclosures, a lot of the improvement has come from non-convergent revenues. I just wanted to ask if that's more B2B driven. What we have seen in the past, some of the other players is these tend to be a bit lumpy, in terms of phasing. Just curious, what are the drivers of this improvement and whether you believe they're sustainable in the coming quarters. My second question is around as a follow-up on TOTEM. I know it may be early to comment in detail, but I just wanted to maybe understand your approach thinking around how the asset fits in the portfolio. In particular, what we've seen from some of your peers is, after a certain point, the realization that if you allow a TowerCo to behave in maximizing its business, it tends to be a bit draining on the cash flow and sometimes the balance sheet of the owner. Whether deconsolidation is something that could be preferable for you or whether you wanna maintain control and whether any partners you see have to be like-minded MNOs or whether you could be perhaps a bit more flexible in that. Thank you. Thank you. I think on Spain, I mean, the improvement is not coming. I mean, I'm not sure if your point is that the improvement of the situation or the turnaround is coming from non-convergent revenues. I don't think that's the case. Actually, it's a combination of several elements. Number one, the reduction of churn. As you know, this was a massive issue a few years back in Spain. The churn has decreased and we work hard on improving the average revenue per user. It's really the combination of the two that's driving the return to growth. Maybe, I don't know if Marie-Noëlle wants to give more colors. No, nothing more just to say. Both B2B and B2C contributes to the growth, with a very good B2B activity in Q1 this year. There's no, you know, balance between one and another. They all contribute to growth. The churn is under control. This is foreseen to continue over 2023. On Totem, as we said in the Capital Markets Day, I mean, for us in driving growth in our infrastructure business is very important. We do allocate resources to the growth of Totem, which is obviously driven by contracts that they can sign, not just with Orange as a telecom, but with the other players. We will be, I would say opportunistic and strategic in reviewing of opportunities to move forward with the structure of Totem only if it creates value, but not just in a move that's just a balance sheet move. It needs to create business value for Orange as a whole and for TOTEM, of course, but not just a tactical, I would say move on the, as the, or the consolidation move as you mentioned. Thank you. Thank you. Our last question for today comes from Nick Lyall of Société Générale. Please go ahead. Hello. Morning, everybody. Was two please, Christel, if I could. The first one was, again, back to Spain. Could you just tell us what the competitor reaction has been like to the Spanish rises? It looks like everybody's rising, raising prices apart from Digi, possibly. I mean, how do you think the EC will view that as part of its investigation? Could you maybe just expand, please? Secondly, on the, on the enterprise, it sounds like a lot of enterprise changes going through. Is there gonna be a large change to restructuring costs because of that? Is that something that might affect guidance a little in terms of cash costs over the next couple of years too? Thank you. Thank you. As you know, we are in the process with the European Union and the commission for the approval of the joint venture with MásMóvil. The process has moved to phase II as you know, early April. We are obviously very active responding all questions. The price moves that happened in Spain are really reflecting the pressure on our cost structure with inflation. It's and as a reality, they started to happen way before actually we initiated our transaction with MásMóvil. We continue to be very strong in our plan with MásMóvil, which will create value for the Spanish customers and the Spanish market. As you know, for us, the JV is really a way to generate more ability to invest in our infrastructure in Spain. That's our key message with the Commission. Obviously it's too early to comment on the outcome of the process. Maybe I let Marie-Noëlle comment. Yeah. Just interestingly- on the move in Spain. When we were discussing with the Commission for the Belgian case, we were exactly in the same situation because we increased the prices at the very beginning of the phase II. We had that discussion. Fortunately, these increases are so widespread across, you know, all the countries and all operators that we really explained to the Commission that it was absolutely two separate questions. That was, you know, the point also of the Commission for Belgium. I foresee that for Spain it will be the case, and it will not have any effect on our discussions. On your question on the transformation of our Orange Business, which we commented in our Capital Markets Day, the discussions are moving as per plan, but I will let Jean-Michel provide more colors on the restructuring side. Yes, Nick. I confirm that the cost of this restructuring plan for the voluntary departure plan is fully embedded into our financial trajectories and the guidance. No worries on that. That's clear. Thank you very much. Thank you. Now I would like to hand the call back over to you, Miss Heydemann, for any additional or closing remarks. Thank you all. I'd like to wrap up this earnings presentation to conclude by insisting on the fact that our value strategy is on and price increase will deliver impact over H2 or over the year, the rest of the year. As you understood, our transformation is also ongoing. Once again, we are fully confident in achieving our full year guidance, which remains unchanged and we are in motion. Thanks a lot, and look forward to exchanging with you in the next quarter and for H1 results. Thank you, ladies and gentlemen. That concludes today's call, and you may now disconnect.